Tesla shareholders show their frustration and anger after Musk announces a new political party

The founding of the "America Party" -Elon Musk's new political party-is prompting a backlash of anger and frustration from Tesla shareholders who see the company's CEO as unfocused on his business duties as the company's earnings and stock fall sharply.

Musk, who vowed in April to step away from the political spectacle to devote more time to Tesla after quarterly earnings plunged 71% and shares fell hard, seems to have managed to lose popularity and support even among his most loyal followers, who began sending letters to Tesla's board of directors to take action and bring the billionaire to heel, The Washington Post reported.

"The board can’t just sit here and watch this go by without saying something and putting guardrails in," Dan Ives, managing director of Wedbush Securities, said, which has long harshly praised Musk's leadership at the helm of the company. "I’m hearing from many shareholders that the frustration is hitting a tipping point."

Over the weekend, James Fishback, CEO of investment firm Azoria, a significant shareholder, sent a message to Tesla's board chairman requesting action and steps to clarify the situation.

"I encourage the Board to meet immediately and ask Mr. Musk to clarify his political ambitions and evaluate whether they are compatible with his full-time obligations to Tesla as CEO," Fishback said. "I remain hopeful that Mr. Musk will return his full attention to Tesla. If not, I trust the Board will take appropriate action."

These comments coincide with another plunge in Tesla shares, which closed Monday down another roughly 7% after Musk announced the creation of the "America Party."

Fishback, who is openly sympathetic to Trump, also announced that his firm was canceling the launch of a Tesla-focused investment fund after Musk announced the founding of the new political party.

"This creates a conflict with his full-time responsibilities as CEO of Tesla," Fishback said. "It diverts his focus and energy away from Tesla’s employees and shareholders."

The tycoon's popularity has dropped so low that even his most loyal supporters are beginning to question him publicly.

A clear example is Alexandra Merz, an investor known on X as TeslaBoomerMama, who last year took a stand in favor of reinstating the $56 billion salary package for Musk, following its judicial annulment in Delaware. Her endorsement was so important that Musk publicly thanked her.

Now her stance appears to have cooled completely. This Sunday, Merz warned the board not to rush into the matter: "If I could give one advice to [Tesla’s] Board: Don’t rush into a new compensation package right now (...) The 2025 package has to be presented at the right time and I think we need to let the dust settle."

Meanwhile, it's clear that Musk is no longer one of the most popular men in the country as he was last year. His performance in the Trump administration, leading the DOGE initiative, generated more criticism than praise for him and also damaged Tesla’s image, which is now going through one of the most complex moments in its history. Meanwhile, its CEO continues to venture into the political arena without certainty of triumph.